El Papel, LLC, et al. v. City of Seattle, Washington, et al.

In March 2020, the City of Seattle prohibited almost all residential evictions. It stripped rental property owners of the right to possess and exclude and for the next 18 months, the City dictated the terms, conditions, and duration of tenants’ occupancy. Petitioners El Papel, LLC and Berman 2, LLC are housing providers in Seattle. Both were forced to relinquish possession of their rental units to unwelcome occupants. Ala. Ass’n of Realtors v. Dept. of Health & Human Svcs., 141 S.Ct. 2485, 2489 (2021) (“preventing [property owners] from evicting tenants who breach their leases intrudes on one of the most fundamental elements of property ownership—the right to exclude”). The Ninth Circuit held that this compelled occupation was not an unconstitutional physical taking under the Fifth Amendment because the court interpreted Yee v. City of Escondido, 503 U.S. 519 (1992), to bar all physical takings claims in the context of a rental relationship. The question presented is: Whether an ordinance that compels the possession of property by an unwelcome occupant is a categorical physical taking, as the Eighth Circuit held in Heights Apartments, LLC v. Walz, 30 F.4th 720 (8th Cir. 2022), or a permissible regulation of use under Yee v. City of Escondido, as the Ninth Circuit held below?